Interactive Brokers reports drop in revenues in Q3 2021

Electronic trading major Interactive Brokers Group, Inc. (NASDAQ:IBKR) has just posted its financial results for the third quarter of 2021, with revenues and profits markedly down from the year-ago period.

The broker reported diluted earnings per share of $0.43 for the quarter ended September 30, 2021 compared to $0.58 for the equivalent period in 2020, and adjusted diluted earnings per share of $0.78 for this quarter compared to $0.53 for the year-ago quarter.

Net revenues were $464 million in the third quarter of 2021, down from $548 million a year earlier.

Income before income taxes was $234 million for the third quarter of 2021, compared to $334 million for the same period in 2020.

Commission revenue increased $32 million, or 11%, from the year-ago quarter on the back of higher customer stock and options trading volumes.

Net interest income increased $79 million, or 41%, from the year-ago quarter thanks to higher margin loan balances and strong securities lending activity.

Other income decreased $199 million from the year-ago quarter. This decrease was mainly comprised of:

  • $191 million related to Interactive Brokers’ strategic investment in Up Fintech Holding Limited (Tiger Brokers), which decreased to a $185 million mark-to-market loss this quarter from a $6 million mark-to-market gain in the same period in 2020; and
  • $30 million related to Interactive Brokers’ currency diversification strategy, which lost $3 million this quarter compared to a gain of $27 million in the same period in 2020; partially offset by
  • the non-recurrence of a $13 million impairment loss on Interactive Brokers’ investment in OneChicago Exchange recognized in the year-ago quarter.

The Interactive Brokers Group, Inc. Board of Directors declared a quarterly cash dividend of $0.10 per share. This dividend is payable on December 14, 2021 to shareholders of record as of December 1, 2021.

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